Fuel prices have continued the downward slide that began in July, with the biggest reductions reserved for diesel which plummeted 20 cents per litre in the space of a week.

Petrol prices dropped just 7 cents per litre overall in August, to just under $2 for 91 octane. Diesel prices fell a total of 24 cents per litre during the same period, to end the month at $1.60 in the main centres.

"The drop in fuel prices continues to reflect a sustained fall in international crude and refined prices, despite the declining New Zealand exchange rate, says Mark Stockdale, AA Senior Policy Analyst.

"International product prices are now back to the levels they were in April. At that time, a litre of petrol cost $1.86, or 14 cents less than today, but the Kiwi dollar was worth 10 cents more. If today's exchange rate was the same as in April, then we'd be paying only $1.86 per litre, and less than $1.50 for diesel."

"Diesel prices fell dramatically in August due to a drop-off in global demand. Unlike petrol, it took a little longer for those decreases to be reflected at the pump."

"The AA's monitoring of importer margins showed the diesel margin was higher than average during July and early August. We believed lower prices were possible and called on the oil companies to reduce them. The subsequent drop in pump prices in mid-August brought margins back to an acceptable level," says Mr Stockdale.

Motorists are now able to keep a closer eye on importer margins, with the Ministry of Economic Development tracking of diesel and petrol margins on a daily basis. These are published on: www.med.govt.nz/oil/price/monitoring/

For more information contact

Mark Stockdale
Senior Policy Analyst
New Zealand Automobile Association
T. +64 4 931 9986
F. +64 4 931 9960
M. +64 21 0220 4700
E. mstockdale@aa.co.nz

The New Zealand Automobile Association is an incorporated society with over one million members. It represents the interests of road users who collectively pay over $2 billion in taxes each year through fuels excise, road user charges and GST.